The main index fell 0.2pc and the mid-cap FTSE 250 shed 0.6pc, as a hefty profit warning from German chemicals giant BASF rocked several industrial companies.
Sterling fell towards its lowest levels in more than two years, pressured by a cocktail of gloomy retail sales data and lingering fears of a 'no-deal' Brexit.
Rupert Harrison, portfolio manager and head of research for the diversified strategies team at BlackRock, said the outlook had deteriorated over the past three months, while the chance of an "extreme outcome" had risen compared with the probability of a managed exit.
"We're relatively negative on the macro-economy. The cumulative impact of the (Brexit) uncertainty... has definitely had a negative impact on momentum," Harrison said.
Dublin's main index, generally sensitive to Brexit jitters and often considered a gauge of risk sentiment, slipped 0.8pc.
Shares of airlines and tourism companies took a hit from the increasing uncertainty. TUI and easyJet fell about 3pc, British Airways owner IAG lost 1.6pc, while Thomas Cook gave up 5.1pc.
The FTSE 100 took a back seat to the domestic index, but was led lower by losses in miners, as copper prices continued their recent slide on worries over waning demand from top consumer China.
However, Ocado surged 5.6pc on its best day since late February after it affirmed its annual forecast, even though its first-half core earnings nearly halved, partly due to the impact of a fire at its flagship robotic warehouse.
A sub-index of chemical companies slipped to a more than six-month low and underperformed the broader index, after BASF warned on profit, citing impact from the US-China trade dispute.
Shares of Melrose tumbled 4.1pc on the main index, while Bodycote, Vesuvius and Weir Group were among the top mid-cap losers.
Software firm Micro Focus declined 5.3pc after a higher-than-expected drop in first-half licence revenue.
RHI Magnesita, which sells products made with heat-resistant materials, skidded 5.9pc on the FTSE 250 after announcing a placing of about 2.2 million shares.